What does this term mean?

What does this term mean?2018-11-06T22:20:47+00:00

Legal Terms Glossary

AbatementA reduction or decrease in amount or worth.
Amortization periodThe number of years it will take to pay back your mortgage.
AnniversaryMany mortgage products allow you to make payments against the principal on the anniversary of the mortgage.
AppraisalThe process of determining the value of a property.
AssumabilityAllows the buyer to take over the seller’s mortgage on the property.
Closed mortgageA set payment schedule to repay a  mortgage
Closing costCosts in addition to the purchase price of a property and which are payable on the closing date. Examples include legal fees, land transfer taxes, and disbursements.
Closing dateThe date on which the buyer takes possession of the property
Common AreasLand or improvements designated for the use and benefit of all residents, property owners and tenants
Conditional offerAn offer to buy property subject to conditions such as loan approval.
Condominium feeA fee paid by the condo owner to help pay building expenses.
Examples of that would be snow removal or lawn care
Convertible mortgageA mortgage that you can change from short-term to long-term
ConveyanceThe transfer of title to real property by means of a written instrument such as a deed or an assignment of lease
Conveyance TaxA tax imposed on the transfer of property (land transfer tax)
DeedA legal document, signed by both parties, that transfers the ownership of property
DepositMoney offered by a prospective buyer as an indication of good faith in entering into a contract to purchase; earnest money; security for the buyer’s performance of a contract.
DefaultFailing to abide by the terms of a loan
Down paymentThe buyer’s cash payment toward the property; the difference between the purchase price and the mortgage loan.
EasementCertain rights that a property owner might have over someone else’s property
EncroachmentThe unauthorized extention of the boundaries of land
EquityThe difference between your home’s value and the money you owe.
High-ratio mortgageA mortgage that exceeds 75% of the home’s appraised value
Income PropertyProperty purchased primarily for the purpose of earning income. Income property can be commercial, industrial or residential
InspectionHaving a home inspected by a third party get a better idea of the condition of the property

Interest rate

The percentage which is charged for the use of borrowed money
Joint tenancyA form of property ownership by two or more persons in which the joint tenants have one and the same interest, arising by one and the same conveyance
Land transfer taxA fee paid to the municipal and/or provincial government for the transferring of property from seller to buyer.
Legal fees and
Legal costs associated with the sale or purchase of a property.
LienMoney owed to a creditor, supplier or contractor.
Maturity dateThe date at which you are done repaying your loan and may have the option of renewing it
MortgageA loan that is taken out in order to buy property
Mortgage brokerA company that offers mortgages from several different financial institutions
Mortgage insuranceProtects the lender against any losses if the borrower is unable to repay the mortgage
Mortgage life insurancePays off the mortgage in the even that the borrower should die.
Mortgage rateThe percentage interest that you pay on top of the loan principal
MortgageeThe lender. (Usually a bank)
MortgagorThe borrower. (Usually the home owner)

Open mortgage

Allows payments to be made at any time to repay the money owed
Power of saleThe right of a mortgagee to force sale of the property without judicial proceedings should default occur
PrincipalThe dollar amount borrowed or owing on a loan.
Property surveyA legal description of your property and its location and dimensions (usually required by your mortgage lender).
Purchase AgreementA legally binding agreement that defines the price, closing date and items that are included with the purchase of the house
RenewalRenegotiation of a mortgage loan at the end of a term for a new term.
Right-of-wayThe right or privilege to pass over a designated portion of the property of another
Sales taxesTaxes applied to the purchase cost of a property. Some properties are exempt from sales tax and some are not. For instance, residential resale properties are usually GST exempt, while new properties require GST
Service chargesExtra costs incurred such as hydro, gas, phone, etc.
SurveyA document that shows the boundaries of the property and specifies encroachments, easements, and the placement of buildings on the property
TitleLegal ownership in a property
Title SearchAn examination of public records to determine and confirm a property’s legal ownership, and find out what claims are on the property